The Gray Hair Speaketh

Advice that is largely Unsolicited.. – Best Deals for Group Purchases!

I was pleasantly surprised when @sampad shared the link of one day, and I went and checked it out. The concept was so close to my heart that I loved it at first sight. The concept. The site, I still had to go over and see! So this concept that I have loved for long, and which finally sees the day in the form of, made me come out of Gray Hair Wisdom Hibernation, and restart my startup reviews.

Category: B2C -> E-commerce -> Group Buying / Reverse Auction

What is it? is an online business that offers great deals, provided large number of people are willing to pick up the deal. In short, it is a group buying concept, and in some ways, a reverse auction also, since more the buyers, the better the deal that can potentially get generated!

What more?

The site does not expect to deliver any products to you. In that sense, there is a “local” factor to it. At this time, has deals to offer, for major Indian cities.  The concept is that many individuals who do not know each other, may be considering making the same purchase around the same time. If they could somehow be got together, and they position themselves as a “group” to the seller, this group now has a buying power to negotiate best deals from the seller. Likewise, if this disparate group of buyers, individually, could have walked into different outlets to make their independent purchases. Now if some dealer offers the best prices, and all those footfalls are diverted to that one dealer, he in turn, is grabbing the market from the other dealers, who did not offer that great deal.

This in a gist, is what enables.

My Quick Two Cents:

I am totally prejudiced to this business idea. In favor of the business concept, per se. So some of that will show in my thoughts here 🙂

Wanamo works for many reasons:

  1. It brings together people who want to buy the same thing, but did not know each other. And the group translates to discounts!
  2. The supplier of the product is transparent. The buyer knows what he is buying, from whom (traditional supplier) is he getting.  Buyers get the vouchers directly of the brand / supplier.
  3. Products do not need to be shipped. Takes away the issues of shipping, handling, octroi etc. The costs and the pain! Once deal happens, the buyer prints the voucher, and goes and picks up the product / service from the supplier directly.
  4. Everyone loves a deal. And deal is what everyone gets. For a simple reason that it’s a quantity purchase each time, and which assures a deal!

All of these reasons are from the point of view of the business model. Then coming to the actual implementation and execution, it looks good, mostly. The concept is not easy to explain. This is the clear make-or-break. I think Wanamo does a reasonably good job of getting the message across. Also the implementation has been kept quite simple and straightforward, and that can play a huge role in the ultimate success.

And now for some Wisdom Nuggets:

There are things that can hasten the path to success.

  1. The screen, as you can see from the home page snapshot above, is crowded. If the aim is to reach a highly mature Internet user, who can understand the various links and blocks all over the screen, then its fine. However, I suspect, to drive numbers, Wanamo will need to reach a slightly lower common multiple of the user base, and that user may just find the screen too busy.
  2. Speaking of screen design, it is a fine balance between temptation (to put everything there) and restraint (to put nothing but the very necessary items there). In the day and age of Facebook, Twitter, etc., there are the Facebook Fan boxes, Twitter widgets, besides the feedback link, the subscribe to newsletter link, etc. that seem like good things to have on the screen. Ultimately these will impact transactions. If its your blog, Sampad, you can get away with it. It is not a transaction engine. Where you want people to transact, to remove their wallet and put in the advance payments, there, you want nothing to distract and turn them away. Least of all, a crowded screen. So think about it.
  3. The one-deal on the home page may be a good way to start, and may also be what is logistically possible to be achieved. But with one deal a day, it will be very very tough to scale. Users have very low attention spans, and very low patience. And very little time. If I get a link of, and I reach the site. I see a deal. And that is all I see. And I am not interested in that one. Then, thats it. To get me to visit again, out of curiosity, is difficult. Unless there is a lot of money spent, and I keep seeing and reading Wanamo everywhere, there is a tough chance that I will go back on my own. Since I just have too many other things to do in life! Offering many deals across multiple products and categories is a way to interest more number of people.
  4. Finally, this is a great B2C e-commerce model. But the only way it will succeed, and succeed really really well, is if it gets scale. If there is even the slightest of satisfaction or relaxation perceived, with a few hundred participants or transactions, that is doomsday. One only needs to look at Ebay or Amazon, and see what kind of engines have been set up. In fact, Ebay should be the model to ape. And what is it about Ebay that should be aped? That you put up a great engine, keep investing in software and features, but then let vendors and customers go out there and help themselves. And you count the pennies that they keep leaving behind. And since these will be pennies that are left behind, you need a lot of transactions for these to count up to a lot of dollars. THAT is the only serious way to make this a business of massive proportion. If there is a large manual component in the transactions, or in pushing each vendor or customer, then I am afraid, it will grossly under-deliver to its potential. I mean, the founders will move from a small to a mid-size car or even a big car, but if they can set up their own VC fund in a few years or not, depends on whether Wanamo can look to be the Ebay of group buying-reverse auction, and churn out millions of transactions, or not!

All in all, a great business model. One of the best e-commerce plays that I have seen in recent days, and if all goes well, this is the one that we will hear a LOT about. Knowing what I do about at least one of the founders, Sampad, I know that he has huge determination and an excellent sense of the medium, and he  and his team just need to stay on track, and deliver this well. Wishing them the very best!!

GRAY SCALE RATING: 4.0 / 5.0 (only because its early days and it can go up, as we see good execution too!)

ADDENDUM: By coincidence, noticed this Tech Crunch article just the same day that I wrote this review of And it is quite disturbing. I await the founders’ clarification, since Abhishek had already commented here. Where lies the mystery? If Wanamo is a copy-paste copy of Groupon, then its bad. If there is a legitimate tie up, same needs to be mentioned clearly!!

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April 4, 2010 - Posted by | Uncategorized | ,


  1. Hi Sanjay – thanks for the encouragement, we were to meetup but somehow couldnt yet – would love to take it ahead

    your suggestion on going ebay way(self serve) is brilliant – but it would take a huge execution resource right….so this is as you rightly pointed out just “a start”

    p.s – rightly sampad has been our USP 😉


    Comment by abhishek | April 5, 2010 | Reply

    • You are welcome, Abhishek.
      Yeah would love to meet you guys and share thoughts whenever we get a chance to set that up. It will be my pleasure.
      As regards being like ebay, keep that vision. That’s the place to be!

      I mentioned Sampad in particular, because I have “known” him – well mostly, virtually. I am sure the entire founding team is a great one, just that I don’t know you other guys! All the best.

      Comment by Sanjay Mehta | April 5, 2010 | Reply

  2. sure, Sampad would re-connect on same asap. posted your review to our fans 🙂

    Comment by abhishek | April 5, 2010 | Reply

  3. Found a disturbing article at Tech Crunch showing a US site, and its Russian copy, about the same business. And guess what, looks identical too!! So what is the deal here? Need Abhishek to clarify, please.

    Comment by Sanjay Mehta | April 5, 2010 | Reply

  4. so how do we define cloning here? is copying the model a clone, or copying designs and layout called a clone or copying the name called a clone.

    business is about well doing business – if som1 else has done it well and you can learn from it – wht’s stopping you?

    business is also about execution and not starting up something – designs can be changed but execution takes real efforts – its okie if some of the indian sites have been inspired by groupon – no way id degrade them calling them “clones”

    we will develop our on way of doing things down the line – very much as u are aware we have been working on multiple models and strategies – and i can tell you its one of the tougher models to execute – those who clone it with short term quick fix intentions will never be able to succeed

    for us it was a matter of resources – we said lets not fixx whts not broken – lets start and down the line we mature and change accordingly

    Comment by abhishek | April 5, 2010 | Reply

    • Abhishek,
      There have been a lot of business models copied. And I agree, that business is not about just the model or the idea, but about execution.

      Still, call me a purist or whatever, I do find it shocking when the design is lifted totally and completely. I find it hard to swallow. And my sentiments are exactly what the Tech Cruch article says, in the last para.

      Comment by Sanjay Mehta | April 5, 2010 | Reply

  5. surely wont say we have been totally innovative – but the base is built and you’d see a fresh design being introduced pretty soon. in terms of the model we have adopted the best from others and customised wherever req – for example we dont take entire money online but only a part payment/booking fee

    as we go forward expect things to change drastically specially the business model in itself, it was a starting point and not proud of it but not ashamed too – a casual look may say its clone but indeed the execution isnt a clone – its taken hardwork, blood and sleepless nights efforts 🙂

    Comment by abhishek | April 5, 2010 | Reply

    • Ok, Abhishek.
      Fair explanation. We will surely keep an eye and look for the changes that will come.

      The learning, if you will like to take, from this experience, is that:
      a. The world is small today. News travels fast.
      b. First impressions matter a lot. If you had cloned everything other than the look and feel, no one would have noticed. But if you clone only the look and feel, not many come and seek your verbal explanations. They make their own judgments!!

      Hope you find these to be useful lessons!!

      Comment by Sanjay Mehta | April 6, 2010 | Reply

  6. Its sick!
    Idiot copy-cats.

    Comment by Brahma | April 6, 2010 | Reply

  7. From wanamo’s website:

    “ is the 1st baked product from the stable of MediaCrest Digital Solutions. The genesis of “Group Bargaining Power” as a concept came to us when we were working on a project for a Fortune 50 company (major consumer electronic brand) where such ideas were getting shaped at a grassroot level. Post that experience, we did intense research and duly understood the penchant of Indian consumers for deep discounted deals on services/products. ”

    After looking at group-on … I dont think this line is justiofied … I would rather say that “we got the idea from a similar and proven business model in other countries”

    I am not against copying the concepts … but be true to your words is what integrity is … This just shows integrity of the business

    I would like an explanation … open to healthy debate … I posted the similar concern in the facebook page … but it got deleted and nobody cared to give me an explanation

    Comment by Christophe Roberts | May 7, 2010 | Reply

    • Hi Christophe,
      Your comment will not get deleted here 🙂

      Yes, I guess, they may need to change the comment on the site.

      I will just question the words that you used.. about “a similar and proven business model..”.
      For now, Groupon has succeeded is raising big money. Which in the US context, is a VC’s call. And that is still far away from real success.
      Will Groupon stand with Amazon, Ebay and others, in a few years, as a part of the ecosystem of e-commerce? I think the jury’s out still.

      Comment by Sanjay Mehta | May 7, 2010 | Reply

      • I agree with the choice of words that I used … it is a similar model … but not yet proven model … time will only tell that

        I am skeptical about the scalability of the business model … amazon and eBay can scale to millions of products for millions of users and can generate sweeping revenue … in case of groupon … the product / service they offer can be limited … and may only appeal to few users … and hence the inherent limit on the scalability

        Comment by Christophe Roberts | May 7, 2010

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